According to a new report by International Data Corporation's (IDC), China-based vendors further strengthened their positions in the smartphone category with the collective share of China-based vendors reaching 53 percent in 2017 from 34 percent a year ago.
"The untapped demand in the lower-tier cities remains the key attraction for China-based brands to explore the growth trajectory in India. Their strength in their home market of China and weakening position of local players has helped some of these China-based players to solidify their operations in India," says Jaipal Singh, Senior Market Analyst, IDC India.
Meanwhile, a report said Indian smartphone market witnessed a healthy 14 percent annual growth with a total shipment of 124 million units in 2017, making it the fastest growing market amongst the top 20 smartphone markets globally.
The report further said that market resumed its double-digit growth after a temporary slowdown in 2016 caused by factors such as demonetization and a shortage of smartphone components. This contrasts with China, the world's largest smartphone market that saw its first decline this year, while the USA was relatively flat.
IDC pointed out that, while feature phones remain relevant to a large consumer base in India, the Indian telecom operator Reliance Jio shipped huge shipments of 4G enabled feature phones taking the leadership position on its maiden quarter in this category.This resulted in a total of 164 million feature phone shipments in 2017 from 140 million a year ago. In 2017Q4, vendors shipped a total of 56 million units in the 2017Q4 making it the highest-ever shipments in a single quarter. The category registered a huge 67 percent year-over-year (YoY) growth and 33 percent growth from the previous quarter.
Commenting on the key trends of 2017Q4, Upasana Joshi, Senior Market Analyst, IDC India "Xiaomi taking a lead over Samsung in the smartphone market and Reliance Jio emerging as the leading feature phone company in India were the two key highlights of the last quarter of 2017.
"The growth of both the vendors was propelled by their aggressive pricing. Xiaomi's offline expansion and higher marketing spends were other key factors for the vendor's high shipments in the seasonally low quarter, Joshi added.
IDC also said that, the competitive landscape is becoming more challenging in India, the low smartphone penetration remains a major attraction for all devices vendors, and they are now making serious attempts to address the problem of affordability in India with the introduction of more affordable products, resulting in initiatives such as Android Oreo 'Go edition', telco bundling with low-cost 4G smartphones and even the 4G feature phone JioPhone.
Furthermore, consumers experience and get hooked on to data, their need to be on a digital platform will go up and smartphones will be the first platform for many of them. IDC expects the Indian smartphone market to continue double-digit growth for next couple of years.